For the year ended December 31, 2022, the job cost sheets of Cinta Company contained the following data.

Other data:

1. Raw materials inventory totaled $15,000 on January 1. During the year, $140,000 of raw materials were purchased on account. Factory labor incurred was $157,000.

2. Finished goods on January 1 consisted of Job No. 7638 for $87,000 and Job No. 7639 for $92,000.

3. Job No. 7640 and Job No. 7641 were completed during the year.

4. Job Nos. 7638, 7639, and 7641 were sold.

5. Manufacturing overhead incurred on account totaled $120,000.

6. Other manufacturing overhead consisted of indirect materials $14,000, indirect labor $18,000, and depreciation on factory machinery of $8,000.

Instructions

a. Using the format shown in Illustration 2A.24 and the information provided above:

1. Enter January 1 balances in Raw Materials Inventory, Work in Process Inventory, and Finished Goods Inventory.

2. Record the 2022 transactions.

b. Prove the agreement of Work in Process Inventory with job cost sheets pertaining to unfinished work.

c. Record the adjustment for over-or underapplied manufacturing overhead, assuming the balance is allocated entirely to Cost     of Goods Sold.

d. Determine the gross profit to be reported for 2022. Sales were $530,000.

Transcribed Image Text:

Job Direct Direct Manufacturing Total Number Explanation Materials Labor Overhead Costs 7640 Balance 1/1 $25,000 $24,000 $28,800 $ 77,800 Current year's costs Balance 1/1 30,000 36,000 43,200 109,200 7641 11,000 18,000 21,600 50,600 Current year's costs Current year's costs 43,000 48,000 57,600 148,600 7642 58,000 55,000 66,000 179,000